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BlogWhat is a Financial Audit? Everything Retirees Need to Know

What is a Financial Audit? Everything Retirees Need to Know

The health of your finances plays a major role in planning for retirement. Whether you are considering starting retirement soon or you have already done so, having a sound strategy can ensure that you can continue to provide for yourself in your post-career stages of life. 

Since our founding, we’ve helped Idaho retirees enter retirement with confidence and a greater feeling of security. With most consultations, this begins with one of our free audits. 

What is a Financial Audit? 

In the context of financial advising or retirement planning, a financial audit is an inventory of all income streams, outstanding debts, savings, and existing high-value assets in your possession. Adding these up provides a holistic view of your situation and can aid a consultant in formulating the best strategy possible for you. 

Why are Financial Audits Important? 

A financial audit will alert a financial advisor to any concerns, such as outstanding debts, that a potential retiree should account for and plan to pay off as soon as possible. The advisor can create a strategy with the client and formulate a payment plan that can allow the retiree to enjoy their post-career life without being bogged down too heavily by these expenses. 

Furthermore, based on an individual’s financial situation, an advisor may be able to guide the client toward resources they may not have known about otherwise. Depending on the retiree’s savings existing income streams, the advisor may also recommend investment strategies to generate new passive income.

What Do Financial Audits Cover? 

Our financial audits are intended to analyze your current portfolio and identify which potential problems and opportunities presently exist. We look for opportunities where potential retirees can lower any recurring fees, mitigating excessive risk, and formulate new strategies to optimize investments. 

Ultimately, at the end of the audit phase, we aim to accomplish the following goals: 

Confidence in Retirement

We want you to have a better understanding of the steps you have to take to enter retirement. This will help you build a reasonable timeline and provide greater assurance for when you are ready to reach this important milestone in your life. 

Organized Finances

Closely monitoring your finances is especially important when you are no longer generating regular income. We strive to provide you with a full picture of your current financial situation and identify opportunities to both reduce expenses and grow investments. 

Diversified Investments

A diversified investment portfolio is often healthier than a more homogenous one. Our advisors are investment experts and want to aid you in creating a realistic roadmap toward maximizing your returns. 

Preparing for a Financial Audit

When you are ready for a free financial audit, we recommend that you come prepared with the answers to the following questions: 

How Much Risk Are You Taking? 

In short: Is your current investment strategy too high-risk for a person in retirement? This information can help us assess the health of your portfolio and recommend actions to reduce risk while not diminishing returns. 

Are Your Returns Acceptable Given the Amount of Risk? 

Is your high-risk investment strategy actually generating worthwhile returns to justify the chances you are taking? For many, this is not the case. A financial advisor can help offer strategies to optimize investments away from high-danger and into more secure options. At Journey, we also offer investment management services where our team can directly manage your portfolio on your behalf. 

How Much Are You Paying in Fees? 

What are your current monthly expenses? How many of them are for a specific period of time (like a car loan) and how many continue indefinitely (i.e., utility bills)? Take inventory of all your monthly payments – including a total sum and each individual fee. 

When our advisors review this information, we can help you identify strategies to reduce these expenses, where possible, so that you have more disposable income in your possession. 

What Could You Be Doing Better? 

Some people struggle more than others with managing finances efficiently. That’s where we can help. Our team will review your audit and look for places where you can improve your overall financial health. This will provide greater confidence as you prepare to retire and we can also offer resources to educate you on financial best practices for retirees.

Once the Audit’s Finished, What’s Next? 

Our audit is completely free of charge and free from any other types of expectations. At the end of your audit, if you decide to work with us, we’re delighted to have you join our community of other confident retirees. If not, we will continue to be available should you ever need our assistance again in the future. 

Get Your Free Financial Audit Today 

We want to help you to begin planning for your retirement with confidence. To help with that, we offer a free 90-minute financial audit. This is a perfect resource for both those considering retiring or who have already done so. 

To learn more, visit our Financial Audit page, call 208.522.9169, or email office@journeyfinance.wpengine.com. 

What retirement dreams do you have? Our team at Journey Financial is dedicated to helping you achieve those dreams, whether big or small. Let's navigate your financial journey together.